NFIB admits its position on Medicaid expansion will hurt many small businesses

The National Federation of Independent Business (NFIB) has strongly advocated that states not expand their Medicaid programs as allowed under the Affordable Care Act (Obamacare).  This wasn’t a business decision by the organization because expanding Medicaid will benefit small businesses as I have pointed out in opinion editorials (here, here and here).

Instead it was a partisan decision that has been part of the highly political NFIB’s opposition to Obamacare since before there even was Obamacare.  The NFIB was a prominent plaintiff in the Supreme Court challenge to the healthcare law and rails against it to this day.

But now that the NFIB has been politically successful in convincing most states to either outright reject expanding Medicaid or delaying the decision (only 22 states plus the District of Columbia have committed to the expansion), they are now trying to undo the damage to small businesses that their advocacy will spawn.

In a March 18^th letter the NFIB sent to the IRS, the faux small business organization admits that any state that follows the NFIB’s position against expanding Medicaid will result in many small businesses in that state with 50 or more full-time employees being subject to significant penalty fees for those employees who would have qualified for Medicaid.  Under Obamacare any businesses with these numbers of employees are required to either offer health insurance or pay a $2000 annual fee per employee if even one of the workers receives a health insurance premium subsidy within the new insurance exchanges.  However a penalty fee would not be paid on employees covered by Medicaid.

“A business should not face expensive penalties for state and regulatory decisions beyond their control,” the hypocritical NFIB whined to the IRS.  The NFIB wants the IRS not to levy the penalty fees on businesses in states that followed the NFIB’s own position on not expanding Medicaid.

This financial liability for not expanding Medicaid has been well known since the law was passed.  The NFIB simply chose not to share this information with the state legislatures and governors it apparently has so much sway over because it didn’t fit into their mantra of how “bad” Obmacare is.

Now the NFIB want the IRS to clean up its mess! 

NFIB's bogus poll

Two recent polls of businesses seem to show conflicting results:

“69% of small business owners and manufacturers say President Obama’s Executive Branch and regulatory policies have hurt American small businesses and manufacturers.”

“39% of small businesses say that President Obama is the most supportive candidate of small business, whereas only 31% say the same of Governor Romney.  And 28% are still not sure which presidential candidate is more suportive of small business.”

Sure the questions weren’t the same but the conclusions should be highly correlated.  If 69% of small businesses think that President Obama has been very bad for them, then we shouldn't expect 28% to be undecided and only 31% favoring Mitt Romney on the issue of which candidate is more supportive of small business.

So what happened?

The first finding was from a National Federation of Independent Business/National Association of Manufacturers (NFIB/NAM) poll released yesterday.  The second was from a George Washington University/Thumbtack (GWUT) poll released last week.

The NFIB/NAM poll surveyed businesses with 2 to 499 employees while the GWUT poll surveyed businesses with 1 to 499 employees.  What’s the difference?  A lot!

The GWUT poll analysis says that, “According to US Census data, 91.6% of small businesses have between one and five workers.  Another 3.8% have 6-10 workers, and 4.6% have over 11 workers.”  The authors of the GWUT poll insist that their respondents closely matched the Census data.

So how well did the NFIB/NAM poll do with keeping close to the Census data of size of businesses?  Not very well.

First, the NFIB/NAM poll didn’t include sole proprietors.  So their percentage of respondents with 5 or fewer employees (48%) was vastly underrepresented.   But while the truly small business owners were under surveyed, the NFIB/NAM poll over surveyed the larger businesses. 

The Census data, according to the GWUT poll, shows that 1.9% of businesses have 21 to 100 workers and only 0.33% of businesses have between 101 and 500 employees.  What were the percentages of NFIB/NAM respondents following into these categories?  18% had between 21 and 99 workers and 6% had 100 to 499 employees?

Here are the comparisons between the Census data and the sample used by NFIB/NAM.

Workers           Census             NFIB/NAM
1-5                   91.6%              48%
21-100             1.9%                18%
101-499           0.33%              6%

It doesn’t take an experienced researcher to conclude that the sample used in the NFIB/NAM poll was skewed in favor of larger businesses.  This alone should disqualify the poll as representing the opinions of small business owners.

But wait, there’s more.

All the respondents in the NFIB/NAM poll weren’t even business owners or presidents of the companies.  This poll included 22% of the responses that came from managers.  We have no idea who these managers were or what they managed.  It could have been the maintenance department as far as we know.  Yet the NFIB/NAM poll counts their opinions just as much as the opinion of real small business owners.

But don’t blame the polling company that conducted the survey for this pretty worthless “small business” NFIB/NAM poll…blame the organizations who called the shots on the sample, the questions and the interpretation of the results.  

The polling company’s representative was very careful in his released comments on the poll.   Bill McInturff states, “It’s clear that small business owners and manufacturers are becoming increasingly frustrated by the federal government’s inability to solve America’s economic problems.  Manufacturers place most of the blame squarely on policies coming out of Washington.” 

There you have it from the man who knows the intricate details of who was surveyed and exactly who said what in the NFIB/NAM poll.  He carefully did not say small businesses blame Washington (and by inference the President) for the economy.   He said “manufacturers”.

Obviously this poll was intended to mislead the public and politicians during the last weeks of the Presidential campaign.  The NFIB has once again shown that it really doesn’t represent the true small businesses of this country and it doesn’t mind letting the good name of small business to be misused by big business interests.  In fact, it is paid millions to do just that.  As I have said numerous times before, the NFIB is a small business pretender.

Fortunately, today a new website was launched (www.NFIBexposed.org) that will help the public, politicians and press lift up the curtain and see exactly who the NFIB really is and who’s bidding it is doing. 

NFIB exposed…again

The first time I mentioned Bill Dunkelberg in my blog was two years ago.  Mr. Dunkelberg is the chief economist of the National Federation of Independent Business (NFIB), Professor Emeritus of economics at Temple University and chairman of Liberty Bell Bank in New Jersey. 

Unfortunately, in spite of all those distinguished positions, Mr. Dunkelberg is not a very good prognosticator and certainly not a friend of the nation’s 30 million small businesses.

In 2010 he led the NFIB’s PR campaign against the Small Business Lending Fund the Obama Administration wanted to create in order to encourage community banks to start making small business loans.  Mr. Dunkelberg said that passage of the Lending Fund would lead to “bad loans” that would result in the same kind of financial collapse that resulted from the housing bubble.

Well, the Lending Fund was established and while it has not been a great success in getting banks to meet the demand for small business loans, we also haven’t heard about bad loans threatening the entire financial industry. 

Last week Mr. Dunkelberg’s credentials as a small business advocate for the NFIB were again on display in an interview on WHYY, a Philadelphia public radio station, along with John Arensmeyer, founder and CEO of the Small Business Majority.

Mr. Dunkelberg made it painfully clear who he and the NFIB consider worthy small businesses.  Although there are 30 million small businesses in the country, only 6 million have employees other than the owner according to Mr. Dunkelberg and “those are the ones we worry about” he said.  The other 24 million sole proprietors he dismissed as “little businesses”. 

In Mr. Dunkelberg’s ivory-tower world, almost all the 6 million small-business owners that the NFIB “worries” about would pay higher personal income taxes if the Bush tax cuts end as scheduled for individuals making over $200,000 or joint taxpayers making over $250,000 a year.  Amazingly Mr. Dunkelberg proclaimed, “200-thousand.  250-thousand.  It’s hard to make a lot less than that.”

What?

In a national survey conducted by Lake Research last December for the American Sustainable Business Council, Main Street Alliance and Small Business Majority, only 3% of small businesses with employees other than the owner self-reported family incomes of over $250,000.  That is right in line with all other polling on this issue. 

If Mr. Dunkelberg is so wrong about the incomes of the vast majority of small-business owners, what else is he and the NFIB wrong about?

How about the demand for small business loans?  Since Mr. Dunkelberg is the CEO of a bank he should be an expert on this?

In the radio interview, Mr. Dunkelberg said, “When I talk to all these bankers across the country and also at our bank we find that for the most part that nobody wants more money.  The reason is we have more firms that think the economy will be worse 6 months from now than think it will be better.  We have more firms that think that their real sales will be lower six months from now than it is today.  And we have virtually nobody who thinks it is a good time to expand.”

No small business wants to expand?  No small business needs a loan?  Sounds like a typical bank CEO who listens only to other bankers and wants to sit on his money waiting for the perfect, no-risk small-business loan application.

But at least NFIB’s own survey of its members backs up Mr. Dunkelberg’s opinion.  In May 91% of NFIB members self-reported that they had all the credit they needed.  Only 3% said that financing was their biggest problem. 

However another survey in May by the National Small Business Association found that 43% of its members have wanted loans in recent years but couldn’t get financing.  In June Sam Graves, Republican Chairman of the U.S. House Committee on Small Business wrote, “One of the biggest issues faced by small businesses today is the inability to access sufficient credit and capital.” 

Not only is there demand for small business loans, contrary to Mr. Dunkelberg’s assertion, some small businesses are actually getting the credit they need.  A Gallup poll back in February found that 15% of small businesses were hiring primarily because of the need to expand their business operations and increased consumer demand.  But still not all of even these businesses were getting as much financing as they wanted.  The poll found that one third of the small businesses hiring were adding fewer employees than they needed.

Additionally, the Gallup poll disagrees with Mr. Dunkelberg’s portrayal of small business pessimism.  “Right now, economic confidence is approaching its highest levels in the last four years.  U.S. small-business owners are also about as optimistic about their business and their future hiring as they’ve been at any point during that time,” said Gallup’s chief economist. 

So small businesses are looking for financing, some are expanding and optimism is returning.

All of this means one thing.  Mr. Dunkelberg and the NFIB do not represent most small businesses in this country. 

Maybe the 300 to 350 thousand small businesses the NFIB claims as members consist of all the 3% of small-small business owners that take home over $250,000 a year.  And maybe these NFIB small-business owners don’t need any financing and maybe they are terrible pessimistic. 

But one thing is certain.  They and the NFIB don’t represent the rest of us.  

Tidal wave of lies

There are three main things holding the small businesses back in North Carolina, says Gregg Thompson the National Federation of Independent Business (NFIB) in that state.  “One is regulations, one is health care and one is taxes.”

Mr. Thompson’s comments were part of a nine-state “Stop the Tidal Wave” anti-regulations campaign recently launched by the NFIB and its new national project, Small Businesses for Sensible Regulations (created one year ago and now with an unimpressive 1,333 members).  The effort will include paid advertising and, of course, a lot of fear mongering about how we’re all going to be washed away in a tsunami of federal regulations.  Not present regulations mind you.  But future, mostly unspecified regulations.  Are you scared yet?

To buttress their argument that regulations are the number one problem for small businesses the NFIB cites a February Gallup poll as one demonstrating that “regulatory burdens are a top reason why small businesses are not hiring at pace with previous years.”

But as most polls have shown, regulations are not the reason small businesses are not hiring.  It’s the lack of demand. 

Even the Gallup poll the NFIB references says that. 76% of the small-business owners Gallop polled who were not hiring said that they do not need any additional employees and 71% said they were worried that sales won’t justify adding employees.  “Companies typically hold back on hiring when the economy is weak and when their operating environment is not providing sufficient revenues or cash flows.  This appears to be the case right now,” said Dennis Jacobe, chief economist for Gallup.

However, 48% of the business owners not hiring did say they were worried about the potential cost of healthcare and 46% were worried about new government regulations.  But these were concerns about something potentially happening in the future, worries ginned up by the NFIB’s relentless politically motivated PR campaign against the Obama Administration.  Mr. Jacobe refers to these concerns as “exacerbating an already uncertain and difficult situation.”

In other words, lack of demand is the driver of lack of new jobs, not concern about regulations and healthcare.  If it were the latter, no small businesses would be hiring but the truth is that small businesses are leading the new job creation in this country. 

When Gallup asked small-business owners why they were hiring new employees, 64% cited increased consumer or business demand and 55% said that sales and revenues justify adding more employees. 7% even cited government tax incentives as the reason (you won’t hear the NFIB talking about that). 

So while the NFIB misrepresents the Gallup poll findings, Mr. Jacobe throws cold water on the NFIB bogus claim that small-businesses owners are shaking in their boots over future new regulations.  “Right now,” he says, “economic confidence is approaching its highest levels in the last four years.  U.S. small-business owners are also about as optimistic about their business and their future hiring as they’ve been at any point during that time.” 

This is exactly what the NFIB political machine is afraid of—small business optimism.  It must be stopped.  Thus their 9-state anti-regulation campaign built on distortion and lies.

Facts show Obamacare good for business

Thursday, Jul 26, 2012

The S.C. director of the National Federation of Independent Business continues his organization’s misleading information campaign about the new health-care law (“Replace health law with reforms that work,” Friday). As the president and CEO of the 5,000-member S.C. Small Business Chamber of Commerce and vice chair of the 150,000-member American Sustainable Business Council, I need to correct the record.

First, there is no health-insurance tax on small businesses. There will be a tax on insurance companies to help pay some of the costs of Obamacare; but the law also prohibits insurers from spending more than 20 percent of your premium dollars on administration, marketing, profits and taxes. Since most insurers already have reached this 20 percent threshold and will be refunding $4.3 million in premiums to S.C. small businesses by the end of this month, they will not be able to pass on any new taxes.

Nor will there be “new regulations that will crush small businesses.” Businesses with fewer than 50 employees, or 97 percent of all businesses, have no obligation to provide health insurance and therefore are not facing new regulations. But 45,560 small businesses in South Carolina with fewer than 25 employees can take advantage of the law’s health insurance tax credits, a number the NFIB calls “very few”.

The federation is correct in noting that businesses with 50 or more workers will have some shared responsibility for the health insurance of their employees. They must either provide insurance or pay a fee. It says this will be an incentive to businesses to remain small, and therefore the entire law should be repealed.

But 97 percent of businesses with 50 or more employees already offer health insurance, because they see it as a necessary part of their compensation package. So the NFIB wants to throw out all the benefits of Obamacare that do and will make health insurance more affordable for all of us because of its concern for one out of every thousand businesses that will have a shared-responsibility decision to make.

While no law is perfect, Obamacare is making health insurance more affordable for small businesses.

Frank Knapp Jr.

President & CEO, S.C. Small Business
Chamber of Commerce
Columbia

http://www.thestate.com/2012/07/26/2368153/facts-show-obamacare-good-for.html

Kudos to TV host

For years the National Federation of Independent Business has been the darling of the media.  The NFIB had successfully sold the story that they represented small businesses.  The organization had the money to get in front of the national press and reporters were happy to have an easy “go-to” group on small business issues.

All that has now changed since the NFIB was a lead party in the Supreme Court failed challenge to Obamacare (Affordable Care Act).  The truth about the NFIB’s source of funding and their support for big business positions on issues is now on the media’s radar.  Not only has the NFIB been the target of numerous national print stories challenging its “small business” credentials, even TV reporters are now not simply accepting the organization’s blustery talking points responses to questions.

This Sunday my friend John Arensmeyer, founder and CEO of the Small Business Majority, and Jean Card, VP of Media and Communications of the NFIB, were guests on MSNBC’s “Your Business”.  Host JJ Ramberg started out asking Ms. Card what was in the healthcare reform law that would adversely affect small businesses.

Ms. Card began her response with the typical NFIB misleading “facts” but was quickly stopped by Ms. Ramberg.  The host was not going to let her viewers hear that Obamacare was going to force small businesses to buy health insurance when the truth is that there is no health insurance mandate for small businesses with fewer than 50 employees (97% of all businesses).  Watch Ms. Ramberg push-back on the NFIB spokesperson here.

Congratulations to Ms. Ramberg for not being duped by the PR machine of the small business pretender organization, the NFIB.

Big money behind misinformation on healthcare law

The Hill's Congress Blog

June 29, 2012

By Frank Knapp, Jr., president and CEO, South Carolina Small Business Chamber of Commerce

I received a call from a gentleman, Ralph, this morning asking about my statement to the press yesterday regarding the Supreme Court ruling on Obamacare. He wanted to know why I thought the law was good for small businesses because he had heard so much about how it was going to be harmful.

I’m sure that Ralph had also read the statement by the South Carolina state director of the National Federation of Independent Business (NFIB) following the Supreme Court ruling in which he insists that now that Obamacare has been ruled constitutional there will be an “onslaught of taxes and mandates” on small businesses that will result in “job losses and closed businesses.”

It turns out that Ralph is retired living along South Carolina’s coast but he has a brother in Pennsylvania who owns a small business with less than 10 employees. I learned that his brother does offer health insurance to his employees. So it was natural for Ralph to be concerned for his brother’s business.

I don’t blame Ralph for being concerned. For over two years the NFIB has been misleading the small business community and public on this issue. The organization spent about $4 million in fighting Obamacare in the Supreme Court arguing that the law was unconstitutional. Now with that line of attack gone, all the NFIB has left is continuing to lie about what the law does.

So I explained to Ralph that businesses with fewer than 50 employees, which account for 97 percent of all businesses, do not have to offer health insurance to workers and will not be penalized if they don’t. Therefore there can be no job losses or closing of the doors for these small businesses due to Obamacare.

I also explained that there are no other taxes imposed on these small businesses but there are health insurance tax credits available to millions of small businesses like his brother’s who offer healthcare to their employees. “Do you think your brother could use some tax credits,” I asked Ralph. “I’m sure he can,” was the response.

I asked Ralph to have his brother call me so I could help him on the tax credit issue. I also thanked him for calling and told him that I wish I could have a civil conversation with everyone who has concerns about Obamacare. It has been my experience since the law passed in 2010 that when I have the opportunity to have such conversations with individuals or small groups, the fears fall away.

But the real question is why do supporters of the reform have to continue to correct the misinformation being spread by organizations like the NFIB which are suppose to represent small businesses. Why did the NFIB work so hard and spend so much money trying to kill a law that has already benefitted hundreds of thousands of small businesses that have received the tax credits and will help in other ways to make health insurance more affordable when the law fully goes into effect in 2014.

The answer is money.

According to a Public Campaign analysis of IRS 990 filings from the NFIB and NFIB Small Business Legal Center for 2009-2011, the NFIB organizations have had dramatic increases in contributions since the Affordable Care Act was passed in 2010. But the new-found wealth is not from dues of the average NFIB member. The IRS filings show that the NFIB organizations received $10 million from just 10 contributors in 2010-2011. In the previous year the largest individual contribution was just $21,000. News reports have identified the conservative and superpac Crossroads GPS as one of the NFIB contributors in 2010 giving $3.7 million.

It is clear that the NFIB is acting on behalf of its partisan big contributors and not their members such as Mike Roach. Mr. Roach is one of the small business owners receiving the tax credits. He owns Paloma Clothing in Portland, Ore, and is a NFIB member for 36 years. In March Mr. Roach told the United Press International that “tearing down the law won’t help us; it would hurt….repealing the Affordable Care Act would send us back to the Dark Ages of health insurance.”

So while the Supreme Court Ruling is the end of this story as to the constitutionality of Obamacare, it is not the end of the political story and certainly not the end of the NFIB lies that are intended to scare people like Ralph and his brother. That is what the NFIB is being paid to do.


Knapp is the president & CEO of the South Carolina Small Business Chamber of Commerce. He is also the vice chair of the American Sustainable Business Council.

Source:
http://thehill.com/blogs/congress-blog/healthcare/235665-big-money-behind-misinformation-on-healthcare-law

National Small Business Week

National Small Business Week should be a good time for the National Federation of Independent Business (NFIB) which claims to represent the country’s real job creators.  Unfortunately for the NFIB, exactly who is pulling its strings now has the attention of the national media.  As John Stoehr writes for Reuters (see below), “A close look at its record suggests that the NFIB uses the politically valuable mantle of small business to pursue an agenda that may take its cues from elsewhere.”

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Reuters
May 22, 2012

Who truly speaks for small businesses?

By John Stoehr

Everyone knows that small businesses hate President Obama’s historic healthcare reform law, right? At least that’s what the nation’s leading small-business advocacy group would have you believe.

Joining 26 states, the National Federation of Independent Business challenged the law all the way to the U.S. Supreme Court in March. It claimed the “individual mandate” is unconstitutional and would bankrupt small businesses with unnecessary costs.

Yet while the NFIB claims its multimillion-dollar lawsuit is on behalf of job creators and small businesses everywhere, it’s unclear whether small businesses genuinely support the NFIB position. A close look at its record suggests that the NFIB uses the politically valuable mantle of small business to pursue an agenda that may take its cues from elsewhere.

For one thing, many of its 340,000 members, most of whom employ 20 or fewer workers, have already benefited from the law. According to a March report in the Wall Street Journal, members have seen costs go down thanks to tax credits that were built into the law. Small firms in industries like advertising have also been able to compete with large national companies for talented employees. As one member told the WSJ: “[The NFIB is] doing a very big disservice to their members” by opposing the healthcare law.

For another, the NFIB has a record of lobbying for issues that benefit big businesses, not necessarily small ones. Consider a widespread state tax loophole that lets big-box retailers like Wal-Mart and Home Depot transfer income to out-of-state subsidiaries. This loophole often allows the chain retailers to pay no state income tax, while small businesses do. Yet the NFIB has fought against closing such loopholes.

Moreover, small businesses generally favor some kind of regulation, because such standards often make them more competitive with big companies. The NFIB is opposed to regulation on principle, but it also claims, as many Republicans do, that the threat of regulation on entrepreneurs and job creators – they have a habit of calling it “regulatory uncertainty” – has kept businesses from hiring and thus from stimulating the economy. But observers across the political spectrum say this is a canard. Regulation isn’t preventing businesses from hiring. Poor sales are.

Perhaps it is no surprise that the NFIB fights for issues that the Republican Party as well as big corporations also fight for: deregulation, lower taxes and tort reform. According to the Center for Responsive Politics, the NFIB’s political action committee has raised over $20 million since 1998. In 2010, nearly 94 percent of contributions went to Republicans. This year it’s 98 percent. It spent $9.5 million lobbying against the healthcare reform bill in 2010. And last year, the NFIB received $3.7 million from Crossroads GPS, according to Bloomberg. Crossroads GPS is a non-profit with close ties to Karl Rove, the political adviser of George W. Bush.

Given the partisan affiliations and positions, it’s unsurprising that other groups who claim to speak for small business, such as Family Values at Work, cast a gimlet-eye at the NFIB. So do small-business owners and small-business advocacy groups. Frank Knapp, president of the South Carolina Small Business Chamber of Commerce, called the NFIB a “small-business pretender” and “lapdog” of the U.S. Chamber of Commerce. In April, J. Kelly Conklin, a New Jersey cabinetmaker, wrote in the Hill: “Whether we’re talking about health care or taxes (or both at the same time), NFIB always seems to side with the big fellas – big insurance, big banking, big business – not little guys like me. Why? I don’t know.”

Perhaps few do.

What’s more certain is that calling yourself a small-business group while serving the interests of big business has political advantages.

A Gallup poll showed most Americans trust small business to create jobs, more than they do large corporations or the U.S. Congress. That kind of public opinion explains why the major parties can’t agree on anything unless it has something to do with small business.

And it explains why the NFIB, in speaking for small business, hopes to be seen as speaking for the American people – even though, if the Supreme Court overturns the healthcare law, it’s the American people and their trusted small business who may suffer most.

http://blogs.reuters.com/great-debate/2012/05/22/who-truly-speaks-for-small-businesses/

“Obamacare” repeal a disaster for small businesses

The Hill's Congress Blog
April 2, 2012

By Frank Knapp, Jr., vice-chair, American Sustainable Business Council

The Supreme Court has now completed its three days of hearing on provisions within the Affordable Care Act (ACA), or “Obamacare” as even the president’s reelection campaign is now calling it. Opponents of the ACA will continue their public relations campaign to influence public opinion with hopes that their efforts will even shape the eventual decision by individual Justices.

Therefore it is important that ACA supporters like the American Sustainable Business Council (ASBC) continue to educate the public, and possibly other interested parties, on the negative consequences to small businesses of a successful repeal effort by organizations like the National Federation of Independent Business (NFIB), which joined 26 states in filing the court case against the ACA.

While the ACA is only two years old, the benefits to small businesses, as well as citizens in general, have been very sizable. While “repeal” business groups like the NFIB say that they are representing business interests in their efforts, it is clear that those interests are not those of small businesses.

While the ACA has no mandate for small businesses with fewer than 50 employees (about 97% of all businesses) to offer health insurance, the ACA benefits already in place and to come for small businesses include:

· Giving tax credits of up to 35% that literally hundreds of thousands of small businesses offering health insurance to employees are receiving today;

· Providing affordable health insurance today for tens of thousands of self-employed and other citizens who, without the ACA’s Pre-Existing Condition Insurance Plan, are otherwise uninsurable due to pre-existing conditions;

· Keeping insurance premiums down today by requiring insurance companies to justify rate increases over 10% and top use 80% of small group premiums on actual medical coverage;

· Establishing an insurance exchange that will create more competition between health insurance companies to drive down premiums and end small businesses paying up to 18% higher insurance premiums simply because they are small;

· Dramatically increasing the number of Americans with insurance thus eliminating the hidden tax of $1,000 a year on every family health insurance policy small businesses and other policyholders pay to provide for the uncompensated care of the uninsured;

· Stopping the practice of small businesses paying higher premiums for all employees when they have a worker with a pre-existing condition;

· Providing low-income employees (family income of up to 133% of poverty) with Medicaid thus making private health insurance more affordable for the small-business owner to offer coverage to the other workers;

· Cutting the healthcare chord that keeps an entrepreneur tethered to an employer’s health insurance plan thus encouraging new small business start-ups.

The “repeal” groups seek to take away all the above benefits for small businesses while offering no effective or comprehensive alternative. For the “repeal” groups it is simply a matter of saying NO to these benefits that will make health insurance more affordable for small businesses compared to the healthcare system without the ACA.

While the ASBC is supporting the ACA, we are also promoting other ideas to improve our healthcare system and control healthcare costs including price transparency and integrative healthcare.

Transparency in all healthcare pricing is essential. A legislative proposal by former Congressman Steve Kagen enables consumers to be more effective shoppers for services by providing accurate pricing for all medical services and goods. This will increase competition between medical providers and thus help restrain costs increases.

Patients should be empowered to pursue a full range of healthcare services and products utilizing conventional and alternative treatments for health and wellness. Insurance plans offering access to integrative healthcare expands options, personal choice and potentially less costly yet satisfactory healthcare.

ASBC will continue to resist efforts to turn the clock back on beneficial healthcare reforms and advocate for changes that will lead to affordable and accessible healthcare for all Americans.

Frank Knapp, Jr. is vice-chair of the American Sustainable Business Council, and the president/CEO of the South Carolina Small Business Chamber of Commerce.

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http://thehill.com/blogs/congress-blog/healthcare/219491-obamacare-repeal-a-disaster-for-small-businesses

Commentary: Small-business owners say the future looks bleak if health care law overturned

The Washington Post
April 1, 2012

By Jamal Lee

Last week, the nation’s attention was riveted to the Supreme Court, where oral arguments were being made over the constitutionality of the health care reform law, also known as the Affordable Care Act.

Pundits have been making one prediction after another as to how the high court will rule. But what we haven’t heard are predictions about what will happen to small businesses if the law is overturned.

As a group of long-standing small-business owners who have been suffering for decades under ever-rising health-care costs, it’s frightening to think the safeguards put in place by the law could be undone with the drop of a gavel.

The new law has already reined in costs through provisions such as the medical loss ratio, which requires at least 80 percent of small groups’ premium dollars be spent on patient care instead of administrative costs. Just a couple years ago, a member of our group — small-business owner Walt Rowen in Columbia, Pa. — was quoted a 130 percent increase to his premium. This year, because of the MLR provision, Walt’s premium increased by just 4 percent — the smallest increase he’s seen to his premiums in 10 years.

Numerous others in our group have benefitted from the small-business tax credits in the law. This year, at my recording studio in Laurel, I expect to receive money back from the credits that I’ll use not only to better afford insurance for my employees and myself, but to help grow my business. A lot has been said about the tax credits not being robust enough to help small-business owners, but as small employers constantly watching our bottom lines, we can say without hesitation that no small-business owner will ever turn down a tax credit — whether they think it’s robust or not. Free money is always welcome.

And in two more years, we’ll see even more help through state health insurance exchanges. We’ll be able to pool our buying power with our fellow small-business owners and enjoy the same kind of buying power large companies currently have. Not only would that lower our costs overall, but it would put us on a level playing field with big companies in recruiting and retaining talented employees.

For decades, we’ve listened to elected officials, insurance companies, the media and small-business organizations — including the National Federation of Independent Business, one of the plaintiffs in the suit — lament the high cost of health insurance for small-business owners. Double-digit and even triple-digit increases were the norm.

The Affordable Care Act is the first significant break small businesses have had regarding our health insurance costs. Without it, we’d be mired once again in a system that drains our coffers and hampers our growth. An economic analysis commissioned by the Small Business Majority found that without reform, our health care costs would more than double to $2.4 trillion by 2018 and 178,000 small-business jobs would be lost as a result.

Overturning the law would not help us. It would hurt us.

While the NFIB says it’s bringing this suit on behalf of small businesses, with all due respect to the owners who are members, most of the nation’s mom-and-pop businesses aren’t. Hundreds of thousands of us are benefitting from the Affordable Care Act in multiple ways.

We hope the Supreme Court justices are aware of that fact as they deliberate on this historic piece of legislation.

Jamal Lee is owner of Breasia Studios in Laurel. He co-wrote the piece with other members of the Network Council of the Small Business Majority, a Sausalito, Calif.-based organization.

http://www.washingtonpost.com/business/capitalbusiness/small-business-owners-say-the-future-looks-bleak-if-health-care-law-overturned/2012/03/30/gIQA1gVnpS_print.html

Round two

The media reported that the government’s attorney, Solicitor General Donald Verrilli Jr., had a tough day yesterday arguing in front of the Supreme Court that the Affordable Care Act’s individual mandate was constitutional.  His opening remarks were apparently not as coherent as they should have been and he consequently sustained some very negative questions from the Justices.

Former Solicitor General Paul Clement, arguing for the 26 plaintiff states against the mandate, is reported to have done quite well in his arguments.  However, predicting the outcome based on questions from the Justices is apparently not a science experts caution.

But there was another attorney presenting to the Court yesterday who news reports have barely mentioned if at all—Michael Carvin who is representing the National Federation of Independent Business.  How did he do?

Here is how Elizabeth Wydra, Chief Counsel for the Constitutional Accountability Center, who was in the Chamber described Mr. Carvin’s performance in a radio interview with me yesterday afternoon.

“He was very bombastic almost to the point where I think it was not really your typical Supreme Court behavior.   There is a sense of decorum there.  This isn’t Bill O’Reilly.  This is the Supreme Court of the United States.  I think that might have actually have turned off some of the Justices like Justice Kennedy and Chief Justice Roberts.”

We can only hope.

You can hear yesterday’s entire interview with Ms. Wydra here.  She will again be my radio guest today at 5:25 EST and you can hear it live here.

Millionaire defenders club

A procedural vote this week, possibly even today, in the US Senate will determine if President Obama’s American Jobs Act even gets to be debated on the Senate floor.  The bill doesn’t have a chance of passing the Senate because it, as most legislation now, can’t get the 60 votes needed to overcome a GOP filibuster.

The bill is projected to create 1.9 million jobs.  Like it or hate it, it’s still a concrete proposal to do something about the lack of new jobs.  The American public deserves a legislative debate and vote. 

The Senate Democrats changed the funding for the jobs bill to a surtax of 5.6% of any income over $1 million to attract more votes.  As an example, that would be an extra $5,600 in taxes for someone making $1.1 million.  

I predicted this move a while ago simply because it will resonate with most voters regardless of political persuasion.

But not so for the defenders of millionaires.  There is actually a new organization called The Tax Relief Coalition that apparently thinks that people making over a million a year pay too much tax.   The U.S. Chamber of Commerce and the National Federation of Independent Business (NFIB) are members of the millionaire defender club.

The Coalition claims that 80% of the 2007 taxpayers reporting more than a million dollars in income were “business owners”. 

I’ve talked about this sleight of hand statistics before when the issue was people making more than $250,000 a year.  With a million dollar income benchmark, it is even more true that the vast, vast, vast majority of these folks are only claiming some income from a business investment (they don’t run the business) or are hedge fund managers, K Street lobbyists, or some other very successful professionals.  They’re not Main Street business owners.

In South Carolina there are 4500 taxpayers reporting over a million dollars in income.  If the Coalition is correct, then there should be 3600 “business owners” in this income category. 

I challenge just one of these “business owners” making over a million a year to contact me to discuss this issue.  Just one.   Please!!!!

NFIB buys a Lincoln

The pretender small business organization is at it again representing the interests of its real patrons—big business and the wealthiest Americans. The National Federation of Independent Business (NFIB) has hired former Democratic Arkansas Senator Blanche Lincoln to be the front stooge of its latest publicity stunt, Small Businesses for Sensible Regulations.

Lincoln’s job is to distract the public from the real reason small businesses aren’t doing the hiring we need to lift our economy—lack of consumers and access to capital. Instead the mistress of the NFIB says the problem is that handy boogieman FEDERAL REGULATIONS.

But these nasty regulations don’t seem to bother two segments of our economy that are booming.

Luxury items for the wealthy are flying off the shelves and from the showrooms. According to a New York Time's story today by Stephanie Clifford, “the luxury category has posted 10 consecutive months of sales increases compared with the year earlier.”

Sales for the luxury big retailers are going up, up, up. First quarter sales this year for Tiffany’s were up 20%. LVMH (Louis Vuitton and Givenchy) sales rose 13% for the first half of the year. PPR (Gucci and Yves Saint Laurent) sales jumped 23% for the first six months.

BMW quarterly profits have more than doubled and the first half of the year saw Porsche profits rise 59% and Mercedes $200,000+ S-Class sedans sales increased 14%.

Obviously cash in the pockets of the wealthy drives their spending to boost the luxury market. The continuation of the Bush tax cuts for the top two income brackets and the Dow being up about 80% since March of last year have created luxury consumer spending.

But instead of helping put cash in the pockets of the average consumer, Congress and the President are pulling out over $2 trillion from our economy--money that would have ended up in the hands of workers, the unemployed and seniors. These folks then would have spent the money in our small businesses. As these sales decrease so will our jobs. Our consumer spending problem is due to simple economics 101 and not to Federal regulation scapegoating.

The other segment of our economy doing well, that we mere mortals can identify with, is the pawn shop industry. When you don’t have a job and a small business can’t get a loan or a line credit, pawn shops are the new banks.

According to CNNMoney’s Catherine Clifford, small businesses that are shut out of a small loan or lines of credit from traditional financial institutions are turning to pawn shops. Expensive watches, gold and other big ticket items get the small business owner with cash flow issues the money to make payroll. This access to capital for small business is a very serious problem but it has everything to do with banker fears of risk and depreciated equity assets of small business owners—not Federal regulations on the books.

Lincoln and the NFIB are on a mission of distracting Congress and the public from what our country should be doing to get the economy moving. But they’ll be well paid for their efforts while the rest of us visit the pawn shops.

NFIB malpractice

Soon we will find out how many small businesses in the country received health insurance tax credits for 2010—a benefit under the Affordable Care Act (ACA). The Small Business Majority estimated that there are approximately 4 million businesses with 2 to 24 employees that could qualify for the tax credits if they offered health insurance last year. And reports from major insurance companies indicated that more small businesses decided to offer health insurance specifically because of the tax credits.

But instead of cheering for the small businesses that will be receiving the federal government’s help in making health insurance more affordable, the National Federation of Independent Business (NFIB) made one last minute effort last week to tell small business what a bad deal the tax credits are.

Well, at least they’re consistent. The NFIB fought very hard against national health care reform. After the ACA became law, the small-business pretender organization signed onto the states’ lawsuit trying to have the ACA declared unconstitutional.

There’s nothing new in the NFIB’s inaccurate complaints about the ACA. But, what the heck, let’s have some fun. Here are some of their bizarre accusations:

1. Relatively few will qualify for the credit. So how many small businesses does the NFIB project qualified for the tax credits? 10,000, 30,000, 100,000? No. The NFIB says up to 2 million. 2 MILLION!!! The NFIB calls 2 million small businesses “relatively few”.

2. Calculating the credit may cost more than the credit itself. Come on! The NFIB is correct that a small business should seek a professional tax preparer to apply for the tax credit. Some information needs to be gathered and proper calculations made. But my accountant told me that he was pleased that the accounting requirements were easier than calculating other business tax credits. Small businesses will be getting possibly tens of thousands of dollars in tax credits to reduce the cost of health insurance. If their tax preparer charges more than that for the service, my advice is to find some different help next year.

3. The credit is unlikely to offset insurance cost increases. The NFIB admits that health insurance premiums for small businesses were escalating before the ACA but claims that the reform will pile on extra costs. Well, according to Vincent Capozzi, senior vice president for Harvard Pilgrim, the ACA has only caused premiums to increase one percent, primarily due to the requirement that preventive services have no out-of-pocket charge. Let’s see. An increase of premiums by one percent but getting a tax credit of up to 35 percent of premiums paid. Obviously the same PR genius at the NFIB who thought 2 million small businesses were “relatively few” also failed math.

But somone at the NFIB finally felt a need to respond to critics like me who have been saying that the organization has been committing malpractice for discouraging small businesses from taking advantage of the tax credtits.  So the NFIB ends its latest trashing of the tax credits with this—in red no less:

[CAVEAT: Despite our concerns with the structure of the credit and the criticisms written above, NFIB urges any small business to consult with an accountant to determine whether filing for the credit is a good idea. If they determine that filing is beneficial, then by all means the business should file and get whatever dollars the law will offer.]

Interpretation: “All the crap we’ve fed you for over a year, never mind.”